F&O: Bulls hold tight grip; options suggest higher Nifty trading range

Nifty has to hold above the 12,900-12,950 zone to trigger a bounce towards 13,150 and 13,250 levels, while on the downside supports are seen at 12,850 and then 12,750 levels.

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India VIX rose 1.20% from 20.79 to 21.05 levels. Volatility needs to remain low for the momentum to continue at a higher market base.
By Chandan Taparia

Nifty on Tuesday opened positive above the 13,000 mark, but consolidated in a narrow range of 35 points in the first half of the session. However, it gained momentum in the latter part of the session to hit a new lifetime high of 13,079. The index formed a bullish candle on the daily scale, as the bulls held a tight grip on the market.

The index finally broke out of the consolidation range of last six sessions to close above 13,050 level, even as supports shifted higher gradually. Now it has to hold above the 12,900-12,950 zone to trigger a bounce towards 13,150 and 13,250 levels, while on the downside supports are seen at 12,850 and then 12,750 levels.


India VIX rose 1.20% from 20.79 to 21.05 levels. Volatility needs to remain low for the momentum to continue at a higher market base.

On the options front, maximum Put open interest stood at 12,800 level followed by 13,000, while maximum Call OI was seen at 13,500 followed by 13,000 levels. There was Call unwinding at all immediate strike prices while Put writing was seen at 13,000 and then 12,900 levels. Options data suggested a higher trading range between 12,850 and 13,250 levels.

Bank Nifty opened with gap up of more than 350 points and witnessed sustained buying interest throughout the session to extend its move towards 29,750 level. It formed a bullish candle on the daily scale and managed to close above its immediate hurdle at 29,500 level. The index relatively outperformed the benchmark index amid strong buying interest in private banks. The index ended the session with a decent gain of 700 points. It now needs to hold above 29,500 level to witness a bounce towards 30,000 and then 30,250 levels, while on the downside, supports are seen at 29,250 and then 29,000 levels.

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Nifty futures closed positive at 13,077 level with 1.11 per cent gains. The trade setup looked positive Axis Bank, HDFC Bank, Eicher Motor, Maruti, Dr Reddy’s, Aurobindo Pharma, M&M, Hindalco and Coforge but weak in Titan, HDFC, BPCL, ONGC, Bharti Airtel and IOC.

(Chandan Taparia is Technical & Derivative Analyst at MOFSL. Investors are advised to consult financial advisers before taking an investment calls based on these observations)
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
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